What is Sanctions Re-Screening?
Of course you screen your global customers when you first start doing business with them, but what about when new sanctions are implemented? Sanctions re-screening is the practice of screening your customer base again to check for new sanctioned persons or entities, especially when new global sanctions are implemented in such a sweeping way as the latest Russian sanctions. Even if new waves of sanctions never reach your ears, it doesn’t mean that you won’t be liable for the consequences of violating them. Re-screening your customers should be a regular practice to avoid non-compliance.
Why is Re-Screening Your Customers So Important?
Screening and re-screening your customers regularly helps your business to identify sanctioned entities, so that you can become compliant as soon as possible and avoid trade compliance penalties.
What Are The Risks of Non-Compliance?
Every day, tens of millions of international transactions are made. Each of these transactions must abide by the laws of international trade and global sanctions. If your company does business with global partners, it can be easy to unwittingly violate a sanction imposed by a state. If you want to avoid this to the extent possible, a robust trade compliance program can help you to mitigate the ever-present risk.
In the case that you fall victim to a trade violation, the penalties are enough to cripple a company.
- Loss of export privileges
- Severe criminal fines
- Administration penalties
- Incarceration for individual violators
- Deportation of non-U.S. citizens
Avoiding trade compliance incidents is the ideal situation, and having a regular customer screening process is one of the best ways to do just that. If you find yourself the victim of a possible violation, it is of utmost importance to quickly stop the suspect activity. The situation quickly worsens if your violation was a recurring transaction, as you will likely be penalized on a per-violation basis.
This means that if you go long periods of time without re-screening existing customers, you may end up being in a long-term violation that comes with penalties.
How to Re-Screen Your Customers and Stay Compliant
If your current system of screening customers against denied-party lists is unwieldy, difficult, slow, time-consuming, or confusing, then it might be time to start looking for a better denied-party screening solution.
Denied-party lists contain entities that import, export, or exchange services and goods that have been denied by a government agency. This makes doing business with these entities illegal within the bounds of the governing body. These denied-party lists are compiled by international governments and organizations — and there are more than 1,300 such lists that an international business must take into account.
It can be tricky to navigate global trade as relations between countries can change on a weekly basis, so it is important to have the right denied party screening and re-screening solution.
An ideal denied party screening solution will have the following features:
- A Comprehensive Collection of Global Watch Lists. The ideal solution should make sure that every denied party list included is relevant to your sector.
- Daily Updates. No matter how often a needed list is added to, updated, expired, or changed, the ideal solution should keep your business secure with the most up-to-date information.
- Defensible Audit Trails. It should provide detailed reports and extensive notifications for a robust due diligence process.
- Cutting Edge Algorithms. The ideal solution should have the ability to perfectly customize its parameters to match your business needs without sacrificing precision or risk reduction.
- User-Friendly Dashboard. It should have a user-friendly interface for easy navigation between processes.
- Automated Alerts. It should keep users and managers updated on still pending actions like follow-ups, past due cases, and problem resolutions.
- Synchronization with other Services. It should have the flexibility to fit into the value chain of your export control compliance activities Export Shipment Process and Import Process.
- Integration with ERPs and Business Systems. It should have the technical ability (via API’s, adaptors etc.) to fully integrate with your existing internal technology platforms and screen parties directly from your business systems without needing to open any other application.
If you’re looking to improve your current screening solution, OCR’s Watch List Screening Solution is already trusted by hundreds of organizations globally. Click here if you want to learn more or reach out to us at firstname.lastname@example.org.